Beyond Meat Stock Jumped 8% in Premarket Trading

Beyond Meat stock jumped 8% in premarket trading after McDonald’s expanded test of McPlant burger created with Beyond Meat.

McDonald’s is expanding its test of the plant-based McPlant burger, created as part of its partnership with Beyond Meat,according to CNBC.

Starting Feb. 14, the fast-food giant will roll out the burger at roughly 600 locations in the San Francisco Bay and Dallas-Fort Worth areas to learn more about consumer demand for the potential menu item. The test began in November with just eight restaurants, so the chain could understand the impact on its operations.

The announcement is the latest step in McDonald’s cautious approach to the plant-based meat trend. The company has taken its time to learn more about the longevity of meat substitutes and consumer demand, even as other fast-food chains raced to add the trendy item to their menus. For example, rival Burger King, which is owned by Restaurant Brands International, added the Impossible Whopper to its menu more than two years ago.

The McPlant burger uses a patty made from peas, rice and potatoes to mimic the taste and texture of beef. Toppings include mayonnaise and American cheese. Customers in the two test markets will be able to buy the burger for a limited time, while supplies last.

For Beyond Meat, a wider-scale test is a massive opportunity to impress consumers with its meat substitutes, although it represents just a small fraction of McDonald’s 14,000 U.S. restaurants. Wall Street analysts have grown bearish on the stock, saying the company is struggling with competition and falling U.S. grocery sales.

In preparation for a larger launch with McDonald’s and other fast-food menu items this year, Beyond hired Tyson Foodsveteran Doug Ramsey as its chief operating officer in December. In his team at the meat producer, Ramsey oversaw the company’s supply relationship with McDonald’s.

McDonald’s and Beyond announced a three-year partnership in February. The burger chain has already started selling McPlant burgers in some international markets, including Sweden, Denmark, Austria, the Netherlands and the United Kingdom.Before the official announcement of the McPlant line, McDonald’s tested a meatless burger that used a Beyond patty in several dozen Canadian restaurants in September 2019. By the following April, the chain had ended the pilot and has since said that it has no plans to bring back its P.L.T. burger.